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  • Lev Properties

Your Guide to the Property Investment Process

Updated: Sep 26, 2023

So, you’re considering investing in a property? That’s great! Before you do, though, it is important that you understand the property investment process, so you will know what to expect each step of the way from start to finish.


In this helpful guide, we’ll tell you all you need to know about investing in real estate, from securing properties at auction through to rental arrangements, along with some other useful information in relation to property investment.



Terraced house


The Process: From Securing Properties at Auction to Renting the Property Out

Auction

The first and most important thing before investing in any property is ensuring that you are in a position to buy. This is a crucial step, since it will determine whether you can go through with making an investment and will allow you to determine how much you can afford to invest, with consideration for the estimated costs throughout the process (e.g. how much the mortgage will be and if you’ll be able to charge enough rent to earn profit on this), as well as the initial property deposit.


By determining the goals you wish to achieve with your investment, you can better understand the types of properties that would be feasible for you to buy. A financial adviser can help you with this.


Once this has been determined, then it’s time to secure a property at auction. A property investment agency can be particularly useful at this point, since they are often able to help you to find and secure properties at competitive prices. They will be more familiar with the property market in the local area, and can help you find the best properties for sale within your budget at these competitive prices, thus offering you the most attractive return on investment (ROI) in the long run.


After you have found a property that is suitable for your plans and you would like to invest in, then it’s time to make an offer. When you are investing in a property that you’re looking to fix up then rent or resell, this means that you will have no chain. Being a chain-free buyer, you will not be reliant on the property you are currently living in to sell before you can go through with the deal for the property you’re looking to buy, which is often seen as favourable by the seller - increasing your chances of securing a deal.


It is worth enlisting the help of a professional, who can help liaise the best price with the seller’s solicitor to ensure that you get the best deal possible.


Legal Work

Once you have secured a property, next comes all the lengthy paperwork and legal work. This involves the conveyancing process, in which you will need to instruct a conveyancer or solicitor to start the legal work on your side of the purchase. They will then examine the draft contract and supporting documents, raising any enquiries with the seller’s solicitor where necessary. You will also need to go through these documents, informing your solicitor/conveyancer if you have any queries or concerns.


Though not a legal requirement, it is a good idea at this point to arrange a property survey. This will highlight any major issues with the property that would need rectifying or identify areas where further investigations may be needed. If there are any significant red flags, then you may work with your conveyancing solicitor to try to renegotiate the price.

Property searches will then need to be carried out, also. These are legal searches that must be carried out to ensure that there are no other factors you should be aware of and to confirm that the seller has legal ownership of the property.


Next, you will need a mortgage valuation (assuming you are not buying the property outright), which assures the mortgage lender that you can afford the deposit and that the property provides sufficient security for the loan. Once this has been approved, you will also need to get buildings insurance before the contracts can be exchanged.


Which leads us to the final legal step: signing the contracts. Once the contracts have been signed by both parties, they will be exchanged and your solicitor will work on processing the payment to the seller and lodge your application to the Land Registry, so that the deeds can be transferred into your name.


Renovation

Now that you officially own the property, you can begin to arrange all the necessary renovations you plan on taking place in order to transform the property into your final vision, ready to then rent out or resell in order to start earning a profit on your investment.

Depending on the extent of work that you plan on taking place, you may require the help of an architect and/or interior designer, or just a contractor if you’re only making minimal structural changes and prefer to be more hands on with the design process.


It can be easy to renovate your investment property with your personal taste in mind, but don’t get too carried away with this - keep it minimal and allow your tenants the opportunity to put their personal touches in place. Think about the base things that may need changing before anything else, for example:


- Doing away with damp/mould

- Repainting the walls

- Replacing flooring

- Changing or painting cupboards

- Replacing old doors and windows

- Updating white goods

- Updating furniture

- Tidying the front and back


As for budget, though it’s good to try and set a reasonable budget and stick to it, remember to try strike a good balance between affordability and quality, as this can save you money in the long run.


Finding a Tenant

When renovations are complete, then it’s time to find a tenant to move in so that you can start earning an income and generating an ROI.

Before advertising for a tenant, you first need to consider who your target tenant is; for example, are you looking to rent to students, post-graduates, professionals, families? Once you’ve established this, then you will be in a better position to advertise the property targeting the necessary individuals.


You then need to market your property well. When marketing on online sites, such as Rightmove or Zoopla, pictures are essential, since these play a key part in attracting potential tenants; ensure they are good quality and show each room clearly. It’s also important that your description of the property is clear and accurate, whilst highlighting its most desirable traits/features.


As for rent, you’ll of course want to be charging a rent that will eventually earn you an ROI from when you purchased the property, however it is still important to assess local competition and keep rent reasonable, realistic and competitive, else you may not gain any interest from potential tenants.


When you have found tenants to move into your property and they have signed their tenancy agreement, then you may manage the tenancy yourself as the landlord/lady, or you may enlist the help of another individual/agency to manage the tenancy on your behalf.


Property Inspections: What Are They & Why Are They Needed?

If you do decide to embrace the role of landlord/lady and manage the tenancy yourself, then it will be your responsibility to undertake periodic property inspections throughout each tenancy at the property. This is to ensure that the tenants are keeping the property in a reasonable condition (both the interior and the exterior) as compliant with the tenancy agreement, as well as to record any repairs or maintenance that may be required.


A property inspection will typically look at and record all the relevant details in regard to the general condition and cleanliness of the property, including any items included with the property that are damaged, broken or missing. This may include taking photos as well as notes, all of which will then be produced in a written report.


If you choose to have someone manage the tenancy on your behalf, then they will be able to carry out this inspection instead, informing you of the outcome and raising any significant points or issues.


Investing in Liverpool

So, are you thinking of investing in the property sector? If so, then Liverpool is the perfect place to start. Why invest in Liverpool? Well, being a thriving city with much to offer and many ambitious expansion projects underway, Liverpool properties are ideal targets for investment.

Whether this is your first investment, or one of many, we’re here to help make the process as simple and stress-free as possible here at Lev Properties. When using our services, we will ensure that everything is arranged on your behalf from start to finish, including:


- Securing the property at auction

- Dealing with the legal work

- Managing the property renovation

- Finding a suitable tenant

- Managing the rental of the property and communication with the tenant


All of which we do whilst maintaining open communication with you throughout every stage of the process.

If you’re keen to learn more or have any questions regarding our services and how we could help you, then don’t hesitate to get in touch with us today.

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